Korian: A valuation that can improve
Korian: (BUY, Fair Value EUR38 vs. EUR33 (+15%))A valuation that can improve
With strong H1 results bolstered by the initial positive impact of the strategic plan launched two years ago, management upgraded its FY 2018 guidance maintaining its financial objectives to 2021. However, we estimate that at least short-term guidance items are conservative, notably at the EBITDAR level which remains the main indicator for the operating improvement excluding group’s real estate strategy. So, based on our new estimates that are again slightly above management expectations, we are confirming our Buy recommendation with a FV up to EUR38 from EUR33 (average of a DCF and historical median used as the exit multiple on FY+3).
Korian is an actor on the temporary and permanent dependency care market in France, Germany and Italy. Co. offers and develops services related to dependency through its retirement homes (116 as of Dec 31 2009), follow-up care and rehabilitation facilities (35 as of Dec 31 2009) and psychiatric clinics (11 as of Dec 31 2009). Co.'s operations can be divided into four geographical segments: Medical and Social activity in France (retirement homes); Sanitary activity in France (follow-up care, rehabilitation, psychiatry and home medical care); Italy; and Germany.
Since 1996, Bryan, Garnier & Co has been growing with an absolute conviction that the investment banking landscape would experience a major revolution: most of the large local generalist banking groups will disappear to the benefit of a handful of global powerhouses, and an emerging group of independent, highly specialised boutique investment banks.
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